ok. Feeling a bit thick today. What does this actually mean? Ok - I can read the graph, but the implications and consequences. Beyond the obvious "people are worried", "gold is more expensive" bit, as that can change as quick as sentiment...

It means

A. Cg is back from his mission
B. The end of the world is back on

It means people get more reluctant to give gold away for cheap (because who knows whether they will get it back -- it's still GOLD after all ).

Thanks for posting, cgnao. I checked the rates earlier today, but the trend was not yet so clear since today's data was missing.

I think cgnao's posts are brilliant They always leave me scratching my head!

Glad I'm not the only one. I'm totally clueless. But I think it's all facinating if a bit scary.

Ok. Another stupid question (one of those days...).

Say I had, hypothetically, 6-7k sterling hanging around and I wasn't sure what to do with it, but wanted to diversify my (somewhat sparse - Would represent maybe 25% savings...) savings portfolio. Don't anticipate spending it in the near term, but maybe in 3-4-5 years or so. Originally it was supposed to be a hutch deposit, but....

And say I bought (or at least wanted to hedge against) the end of the world scenarios with some shiny gold things. And I'd quite like the comfort of having them in the physical. What's the best way to do it? Where can you buy krugerands or similar from a reputable dealer (and how much would you expect to pay over the gold spot?). Wouldn't be mad keen on gold stocks etc., and am slightly dubious about paper linked gold (gold's only going to go up if the end of the financial world REALLY gets going, and people are gonna want to hold it).

Any steer?

Also, what are peoples summarised thoughts on gold in a peak oil scenario. As it my job to find the black stuff I can attest to the fact that most oil finders are crapping themselves over the long term (in the short term I'm bearish on oil w.r.t. fundamentals, for now)...

Any thoughts for a sloooow thinker today appreciated.

p.s. what's the deal with moving gold around the world. I have a roaming brief, and would have to either put it in a safety box somewhere (which is a pain if you have to fly to get it), or take it with me....

I bought a smaller amount of gold in the last few days.
.
I could not recomend more highly ATS Bullion (atsbullion.com) for service and transparency.
Its a small office next to the Savoy hotel in London the staff were very patient considering had never bought
gold before.
.
Krugerrands @ 5% over spot.
From 1 coin upwards. Didnt buy enough to ask about bulk discounts
.
If you are in London and can get to the Strand I would recomend them.
.
The above is not advice to either buy or not to buy gold merely that once I had decided to
this place provided an excellent service.
.
What was interesting was the numbers of people visitingin the last few days.
Of all the companies in the same building ATS filled most of the signing in book.
Obviulsy can't compare with say last month or year but it was quite striking.
.
ST

I don't recommend putting them in your luggage at Heathrow.

Why has the price of gold not risen then?

Hello bear_or_bull. Fascinating. What time frame do these people consider to be long term ?

Weired, isn't it? I hear people here telling they're buying coins. Some seem to feel a lack of supply. Funds like Streettracks have gold holdings at an alltime high (see http://www.jsmineset.com/cwsimages/Miscfil...F_8-20-2007.pdf ), but the price seems to go nowhere. Central bank selling anyone? Spain must sell, the Swiss want to sell. Seel, sell, sell. For me this turns into buy, buy, buy, before it is too late.

Hello Goldfinger.

As a novice please would you give me your take on this.

Surely the central banks wouldn't want to sell if they could see a time when we reverted back to gold as a store of wealth?

All systems are go, countdown started.

http://newsvote.bbc.co.uk/1/shared/fds/hi/...0/0/default.stm

Anglo American Ord USD0.54945 2752.00 +148.00 5.68%
Antofagasta 694.50 +40.50 6.19%
Aquarius Platinum Ltd 1415.00 +75.00 5.60%
BHP Billiton 1365.00 +64.00 4.92%
HOCHSCHILD (WI) ORD 50P (WI) 330.00 +18.00 5.77%
Kazakhmys Ord 20p (WI) 1250.00 +72.00 6.11%
Lonmin 3177.00 +214.00 7.22%
MONDI ORD EUR 0.20 460.00 +15.50 3.49%
RANDGOLD RES. ORD $0.05 1194.00 +38.00 3.29%
Rio Tinto 3280.00 +209.00 6.81%
UK Coal 527.50 +23.50 4.66%
Vedanta Resources 1659.00 +69.00 4.34%
Xstrata 2881.00 +126.00 4.57%

Lovely jubbly, I put another £1k into my ML Gold and General fund on Monday.

CREDIT DERIVATIVE MELTDOWN IN PROGRESS

From table 1 on page 23 of 34 in this PDF
http://www.occ.treas.gov/ftp/deriv/dq406.pdf

The biggest derivatives players are (pay careful attention to the "total derivatives" column in the pdf):

1 JPMORGAN CHASE BANK NA
2 BANK OF AMERICA NA
3 CITIBANK NATIONAL ASSN
4 WACHOVIA BANK NATIONAL ASSN

Now look who is borrowing money from the FED:

http://www.businessweek.com/ap/financialnews/D8R679MG0.htm
The Associated Press August 22, 2007, 1:37PM ET
Four major banks borrow from Fed
Four major banks said Wednesday they each borrowed $500 million from the Federal Reserve's discount window, lending weight to its efforts to restore liquidity to tight markets.

Citigroup Inc., JPMorgan Chase & Co., Bank of America Corp. and Wachovia Corp. each stressed they themselves have "substantial liquidity" and the ability to borrow money elsewhere.

- I'm no expert but that table looks absolutely terrifying. Not so much Houston we have a problem but oops there goes the Challenger...

OK - I blow hot and cold on gold. A hear Peter Schiff saying it's going to go through the roof and I believe most of what he says but then I think, hang-on we won't get hyper-inflation here in the UK, but deflation as all assets implode on themselves through the busting of credit and tightening.

Is the real reason we should be buying gold because we could lose money held with banks or other financial institutions?. This whole credit derivatives, CDO's, hedge funds and sub-prime lending thing is starting to get me worried, especially when I hear Barclays is tapping the BoE for money - is there anywhere safe for cash, except government bonds when this all gets really bad.

Mission control, we have lift off.

A 1% rise? Wow!!!!!!!!!!

It's not just the price. It's the fact that it is rising while huge shorts are running for cover. See chart of gold price vs. Goldman Sachs short gold position on the Tokyo Commodity Exchange. This is unprecedented.

Looks like someone big is having a religious experience.

if the price is rising due to shorts running for cover this doesnt mean that there is demand for gold. this actually means that the share price rise is being propped up by people just closing their positions.

also looking at that graph, from the peak short position to todays position, the price of gold hasnt moved an inch. this mean that despite people closing all their shorts (which should create a support for price rises) the price of gold has actually not moved. i.e overall demand has fallen.

Doesn't that simply mean the price is hardening? Is there generally a correlation between these huge shorts and future rises in price?

Always difficult to interpret such things, otherwise we would be all rich. However, that they cover shorts looks to me right now more as if they suspect that gold is in a major bottom, and ready to take off. Has someone similar US-data?

Something huge is brewing.

What is your take on the DOW 240 point rebound today? It seemed quite a strange response, but may have been due to the report below that I posted on another thread.

Or is this all part of the real storm brewing?


http://www.advfn.com/news_Feds-Bernanke-te...d_22051799.html

Federal Home Loan Mo Fed's Bernanke tells key senator central bank is ready to act if needed


WASHINGTON (Thomson Financial) - Federal Reserve Board Chairman Ben Bernanke
said he and his colleagues at the central bank are ready to give a jolt to the
US economy if the current market turmoil spills over into the broader economy.
"The Fed is closely monitoring developments in financial markets" and "is
prepared to act as needed to mitigate the adverse effects on the economy arising
from the disruptions in financial markets," Bernanke said in a letter to New
York Democratic Senator Charles Schumer, dated Monday and released today.
In the letter, Bernanke also said that asset limits on Fannie Mae and
Freddie Mac investment portfolios "need not be lifted to allow them to
accommodate new borrowers."
The Schumer letter was largely a repetition of the points Bernanke made in
his meeting last week with Senator Chris Dodd, a Connecticut Democrat and head
of the Senate Banking Committee.
However, Miller Tabak analyst Tony Crescenzi said the "most intriguing" part
of the Bernanke letter "was his idea for a public/private solution to the
subprime problem."
The Fed chief suggested a collaboration to develop "a broader range of
mortgage products which are appropriate for low-and moderate-income borrowers,
including those seeking to refinance."
Such new mortgage products could be put in place to help the thousands of
homeowners facing "payment shock" when their variable rate mortgages reset to
higher interest rates and payments later this year and in 2008.
Bernanke suggested Congress might allow the Federal Housing Administration
to begin developing such mortgage refinancing options.

Not wanting to just accept everything you post, I've had a look at the historical lease rates for gold. The current spike is "nothing" when compared to the many hundred "moderate" spikes that have occurred over the last few years. Why is its current move significant?

Click to view attachment

Since the last huge spike in 2001 and until today, central banks had effectively flooded the market with gold loans. By doing that they managed to depress lease rates to nearly zero, effectively leasing gold out for free. This is the means by which a managed gold price rise has been achieved, instead of an explosion. If you bothered to look closer, you would have noticed that previous lease rate spikelets in the last couple of years lasted at most three-four days and. This spike instead looks much more intense than any since 2005 and a strong upside trend seems to be developing. This indicates tightness of supply in the market and it is likely that shortly central banks will have to let the price run strongly to reduce demand.

I'd like to know whether there are any longer studies on the gold term structure out there?
I mean, these charts look so unnatural, I could not believe it when I saw them the first time. In particular, that there is zero interest on gold in a time where the price more than doubled -- how can this be possible? Someone made an immensely bad deal. Instead of draining some money from the market, the central banks were basically flooding it. Whoever bought the gold made a fantastic deal, whoever will have to buy and give it back is screwed. Now, that interest rises, less borrowed gold will hit the market, and some borrowed gold needs to be bought back.

The lid must blow off soon.

The European Central Bank and others are clearly trying to save the dollar by inflating their own currencies. More explosive fuel for the gold rocket.

http://www.bloomberg.com/apps/news?pid=new...id=aXHnCSMrsYKA
European Money-Supply Growth Rises to 28-Year High (Update2)
By Christian Vits

Aug. 28 (Bloomberg) -- Money-supply growth in the euro region accelerated to the fastest pace in 28 years in July, adding to the European Central Bank's concern about inflation pressures.

M3 money supply, which the ECB uses as a gauge of future inflation, rose 11.7 percent from a year earlier, after 10.9 percent in June, the central bank said today.

Save the dollar or save Eurozone industry? They can't afford to let the dollar devalue too much wrt. the Euro, the impact on jobs etc. would be disasterous.

Rampant monetary inflation = more gold rocket fuel

http://www.bloomberg.com/apps/news?pid=new...id=a2fRJ.I8ZXGM
U.K. July Mortgage Approvals Higher Than Expected (Update1)

By Svenja O'Donnell

Aug. 30 (Bloomberg) -- U.K. banks approved more mortgages in July than economists had expected, a sign five interest-rate increases in a year have yet to curb demand from borrowers.

Overall, M4, the broadest measure of money supply including deposits at banks and currency in circulation, rose 1 percent in July after a 0.7 percent increase in June. The annual rate of M4 growth accelerated to 13 percent, the most since May, from 12.9 percent in June, the bank said.

13 percent! And now the BoE injects emergency loans....

It's been higher than that before.

Do we really need another thread about how gold is going to rocket and the world will end?

No we don't. Gold will rocket but the world will not end. Actually after a painful readjustment and the return to honest money it may even become a better place.

Well that will be a good thing. (I'm talking about the return to honesty and a better place) But I'll also be quite happy if families can afford to buy reasonable houses without life-damaging levels of debt.

Thanks Houston, en route to the Moon!!

http://www.marketwatch.com/news/story/gold...5D84401A7744%7D
Last Update: 9:00 AM ET Aug 31, 2007
NEW YORK (MarketWatch) -- Gold and other metals futures rose sharply early Friday, boosted by expectations that Federal Reserve Chairman Ben Bernanke and President Bush will offer a rescue plan for troubled credit markets.

Mmm, nice little anecdotal while buying physical today-the merchant I used has seen a VERY busy day and in their words they've been INNUNDATED compared to normal standards.

I dont think you actually get the gold. I think you get a piece of paper with the word "Gold certificate" written on it.

http://www.goldmoney.com

Allocated storage. You own it in your own name. You can transfer ownership to someone else with an account at any time.

cgnao

is there a way for you to tell if that company is actually buying any REAL gold in your name and not just issuing pieces of paper ?

i know they say they put the gold in a vault but how can they be trusted ?

You can get the bar serial number list off their website. Gold is in high security storage with VIA Mat (third party company). This is also audited by an indipendent auditor. To redeem the gold bars out of the vault, another third party trust company must agree. This is a very strong corporate governance. Nevertheless I would recommend not to trust what you read. Go and check by yourself, you can visit or call the vault company.

The weakness in goldmoney is in my opinion that the gold is near London, not offshore. However the records are offshore and there is a provision in the user agreement that allows them to move it to another secure storage provider if they deem it necessary. This would also happen under the control of the third party trustee. The good point is however that the ownership records are offshore and hence out of the reach of the govt.

www.bullionvault.com is the opposite: you can have storage in Switzerland, but it is a British onshore company and therefore within reach of the govt. I don't like this at all. They even tell you in the T&Cs that they will report your holding if you are a British national.

My advice is to travel to Switzerland and open an allocated account with a reputable bank over there. This is quite easy and as bulletproof as you can get. Unfortunately it is only cost effective for fairly large quantities (ten kilos or more) due to the high fixed costs. Goldmoney or bullionvault would still be useful, even in this case, to trade in and out of the market with a small percentage of your holding.

Hope this helps.

6 September. Tower cleared. Engine confirmed, thrust is GO.

The world is crying out for a natural BUST cycle to start, but while the banks and governments try to stave it off itll just prolong the agony when it (The BUST) inevitably begins. According to som commentators, the great depression was caused by such afforts to prevent the effects of a natural Bust in 1929.

Stop! Stop! Not yet! Not yet!!!!

do you have any clues as to decent dealers? the obvious one (Chards), aside from the eye watering premiums,their website makes them look, well, crap

i'm not comfortable with e-gold

Goldline and ATS Bullion have both been mentioned here. I don't know that their premiums will be much lower than Chards though -- I'd expect this market to be pretty competitive. I agree about the Chards web site BTW but I don't suppose it's holding back their business

See! That's what happens when you get distracted by Furby's avatar.